H. B. 4545
(By Delegates Beane, Browning and G. White)
[Introduced February 20, 2002; referred to the
Committee on Banking and Insurance then Finance.]
A BILL to amend and reenact article twelve, chapter thirty-three of
the code of West Virginia, one thousand nine hundred
thirty-one, as amended; and to amend said chapter by adding
thereto a new article, designated twelve-c, all relating
generally to licensing insurance producers, solicitors and
excess lines; defining terms for implementation of the NAIC
Producer Licensing Model Act ("Model"); creating an insurance
producer license for individuals and insurance agencies;
creates a new license type that would allow the licensee to
sell all types of credit insurance, and this license type
would be consistent from state-to-state; creates new specific
nonresident license types to allow for full reciprocal licensing with other states; creates a new "personal lines"
license, pursuant to the most recent amendments to the Model;
provides specific provisions from the Model have been added to
clarify in detail who needs to be licensed and who does not;
reciprocity has been liberalized for licensing nonresident
agents based upon their qualifications in their home state,
and without imposing barriers; the grounds upon which the
commission may deny a license or seek the suspension or
revocation of a license have been expanded and made more
consistent with the grounds utilized in other states;
additional notice requirements are placed upon insurers and
insurance producers when an appointment is terminated for
"cause"; includes notice to the commissioner, immunity
provisions, and protection of confidentiality of
documentation; the continuing education requirements for
agents has been changed from twenty-four hours in three years
to twenty-four hours in two years bringing us more in line
with other states regarding continuing education requirements;
the commissioner will be allowed to contract for the
administration of the continuing education system; and the
provisions in chapter thirty-three (Excess Lines) that relate to the licensing process have been stricken from those
chapters and reenacted as a new article in chapter
thirty-three, so that all relevant licensing requirements
appear together and as consistent as possible.
Be it enacted by the Legislature of West Virginia:
That article twelve, chapter thirty-three of the code of West
Virginia, one thousand nine hundred thirty-one, as amended be
amended and reenacted; and that said chapter be amended by adding
thereto a new article, designated article twelve-c, all to read as
follows:
ARTICLE 12. INSURANCE PRODUCERS AND SOLICITORS.
§33-12-1. Purpose and scope.
This article governs the qualifications and procedures for the
licensing of insurance producers. It simplifies and organizes some
statutory language to improve efficiency, permits the use of new
technology and reduces costs associated with issuing and renewing
insurance licenses.
This article does not apply to excess and surplus lines agents
and brokers licensed pursuant to article twelve-c of this chapter
except as provided in section six, section twelve, section
twenty-four and section thirty-three of this article.
§33-12-2. Definitions.
For the purpose of this article:
(a) "Business entity" means a corporation, association,
partnership, limited liability company, or other legal entity.
(b) "Home state" means the District of Columbia and any state
or territory of the United States in which an insurance producer
maintains his or her principal place of residence or principal
place of business and is licensed to act as an insurance producer.
(c) "Individual" means any private or natural person as
distinguished from a partnership, corporation, limited liability
company or other legal entity.
(d) "Insurance" means any of the lines of authority in section
ten, article one of this chapter.
(e) "Insurance agency" means a business location at which an
individual, corporation, partnership, association, limited
liability company, or other legal entity except for an employee of
the individual, corporation, partnership, association, limited
liability company, or other legal entity, and other than an insurer
or an adjuster as defined by section twelve-b, article one of this
chapter, engages in any activity or employs individuals to engage
in any activity which by law may be performed only by a licensed individual insurance producer or solicitor.
(f) "Insurance producer" means a person required to be
licensed under the laws of this state to sell, solicit or negotiate
insurance. Wherever the word "agent" appears in this chapter, it
means an individual insurance producer.
(g) "Insurer" means every person engaged in the business of
making contracts of insurance under section two, article one of
this chapter.
(h) "License" means a document issued by this state's
insurance commissioner authorizing a person to act as an insurance
producer for the lines of authority specified in the document. The
license itself does not create any authority, actual, apparent or
inherent, in the holder to represent or commit an insurance
carrier.
(i) "Limited line credit insurance" includes credit life,
credit disability, credit property, credit unemployment,
involuntary unemployment, mortgage life, mortgage guaranty,
mortgage disability, guaranteed automobile protection (gap)
insurance, and any other form of insurance offered in connection
with an extension of credit that is limited to partially or wholly
extinguishing that credit obligation that the insurance commissioner determines should be designated a form of limited line
credit insurance.
(j) "Limited line credit insurance producer" means an
individual who sells, solicits or negotiates one or more forms of
limited line credit insurance coverage to individuals through a
master, corporate, group or individual policy.
(k) "Limited lines insurance" means those lines of insurance
defined in section thirty-two
, article
twelve of this chapter or
any other line of insurance that the insurance commissioner
considers necessary to recognize for the purposes of complying with
subsection (e),
section twelve,
article twelve.
(l) "Limited lines producer" means an individual authorized by
the insurance commissioner to sell, solicit or negotiate limited
lines insurance.
(m) "Negotiate" means the act of conferring directly with or
offering advice directly to a purchaser or prospective purchaser of
a particular contract of insurance concerning any of the
substantive benefits, terms or conditions of the contract, provided
that the individual engaged in that act either sells insurance or
obtains insurance from insurers for purchasers.
(n) "Person" means an individual or a business entity.
(o) "Sell" means to exchange a contract of insurance by any
means, for money or its equivalent, on behalf of an insurance
company.
(p) "Solicit" means attempting to sell insurance or asking or
urging a person to apply for a particular kind of insurance from a
particular company.
(q) "Terminate" means the cancellation of the relationship
between an insurance producer and the insurer or the termination of
a producer's authority to transact insurance.
(r) "Uniform application" means the current version of the
NAIC uniform application for resident and nonresident producer
licensing.
(s) "Uniform business entity application" means the current
version of the NAIC uniform business entity application for
resident and nonresident insurance agencies.
§33-12-3. License required.
(a) A person shall not sell, solicit or negotiate insurance in
this state for any class or classes of insurance unless the person
is licensed for that line of authority in accordance with this
article.
(a) (b) No person shall in West Virginia act as or hold himself out to be an agent or insurance agency, broker or
solicitor, nor shall any person in any manner solicit, negotiate,
make or procure insurance covering subjects of insurance resident,
located or to be performed in West Virginia unless then licensed
therefor pursuant to this article.
(b) (c) No agent, insurance agency broker or solicitor or any
representative or employee thereof shall solicit or take
application for, negotiate, procure or place for others any kind of
insurance for which he that person is not then licensed.
(c) (d) No insurer shall accept any business from any agent
who does not then hold an appointment as agent for such insurer
pursuant to this article.
§33-12-4. Exceptions to licensing.
(a) Nothing in this article shall be construed to require an
insurer to obtain an insurance producer license. In this section,
the term "insurer" does not include an insurer's officers,
directors, employees, subsidiaries or affiliates.
(b) A license as an insurance producer shall not be required
of the following:
(1) An officer, director or employee of an insurer or of an
insurance producer, provided that the officer, director or employee does not receive any commission on policies written or sold to
insure risks residing, located or to be performed in this state
and:
(A) The officer, director or employee's activities are
executive, administrative, managerial, clerical or a combination of
these, and are only indirectly related to the sale, solicitation or
negotiation of insurance; or
(B) The officer, director or employee's function relates to
underwriting, loss control, inspection or the processing,
adjusting, investigating or settling of a claim on a contract of
insurance; or
(C) The officer, director or employee is acting in the
capacity of a special agent or agency supervisor assisting
insurance producers where the person's activities are limited to
providing technical advice and assistance to licensed insurance
producers and do not include the sale, solicitation or negotiation
of insurance;
(2) A person who secures and furnishes information for the
purpose of group life insurance, group property and casualty
insurance, group annuities, group or blanket accident and health
insurance; or for the purpose of enrolling individuals under plans; issuing certificates under plans or otherwise assisting in
administering plans; or performs administrative services related to
mass marketed property and casualty insurance; where no commission
is paid to the person for the service;
(3) An employer or association or its officers, directors,
employees, or the trustees of an employee trust plan, to the extent
that the employers, officers, employees, director or trustees are
engaged in the administration or operation of a program of employee
benefits for the employer's or association's own employees or the
employees of its subsidiaries or affiliates, which program involves
the use of insurance issued by an insurer, as long as the
employers, associations, officers, directors, employees or trustees
are not in any manner compensated, directly or indirectly, by the
company issuing the contracts;
(4) Employees of insurers or organizations employed by
insurers who are engaging in the inspection, rating or
classification of risks, or in the supervision of the training of
insurance producers and who are not individually engaged in the
sale, solicitation or negotiation of insurance;
(5) A person whose activities in this state are limited to
advertising without the intent to solicit insurance in this state through communications in printed publications or other forms of
electronic mass media whose distribution is not limited to
residents of the state, provided that the person does not sell,
solicit or negotiate insurance that would insure risks residing,
located or to be performed in this state;
(6) An individual who is not a resident of this state who
sells, solicits or negotiates a contract of insurance for
commercial property and casualty risks to an insured with risks
located in more than one state insured under that contract,
provided that individual is otherwise licensed as an insurance
producer to sell, solicit or negotiate that insurance in the state
where the insured maintains its principal place of business and the
contract of insurance insures risks located in that state; or
(7) A salaried full-time employee who counsels or advises his
or her employer relative to the insurance interests of the employer
or of the subsidiaries or business affiliates of the employer
provided that the employee does not sell or solicit insurance or
receive a commission.
§33-12-5. Application for examination.
(a) A resident individual applying for an insurance producer
license shall pass a written examination unless exempt pursuant to section fourteen,
article twelve of this chapter. The examination
shall test the knowledge of the individual concerning the lines of
authority for which application is made, the duties and
responsibilities of an insurance producer and the insurance laws
and regulations of this state. Examinations required by this
section may be developed and conducted under rules prescribed by
the insurance commissioner.
(b) The insurance commissioner may make arrangements,
including contracting with an outside testing service, for
administering examinations and collecting the nonrefundable fee set
forth in subdivision (8), subsection (a), section six, article
twelve of this chapter.
(c) Each individual applying for an examination shall remit a
nonrefundable fee as prescribed by the insurance commissioner as
set forth in subdivision (8), subsection (a), section six, article
twelve
of this chapter.
(d) An individual who fails to appear for the examination as
scheduled or fails to pass the examination, shall reapply for an
examination and remit all required fees and forms before being
rescheduled for another examination.
(e) An individual who fails to pass examination is limited to seven additional attempts to pass the examination.
§33-12-6. Application for license.
(a) An individual applying for a resident insurance producer
license shall make application to the insurance commissioner on the
uniform application and declare under penalty of refusal,
suspension or revocation of the license that the statements made in
the application are true, correct and complete to the best of the
individual's knowledge and belief. Before approving the
application, the insurance commissioner shall find that the
individual:
(1) Is at least eighteen years of age;
(2) Has not committed any act that is a ground for denial,
suspension or revocation set forth in section twenty-four, article
twelve of this chapter;
(3) Where required by the insurance commissioner, has
completed a prelicensing course of study for the lines of authority
for which the person has applied;
(4) Has paid the fees set forth in section thirteen, article
three of this chapter; and section ten, article twelve of this
chapter;
(5) Has successfully passed the examinations for the lines of authority for which the person has applied;
(c) (6) Is, in the case of an agent applicant, appointed as
agent by a licensed insurer for the kind or kinds of insurance for
which application is made, subject to issuance of license, or, in
the case of a solicitor applicant, appointed as solicitor by a
licensed resident agent, subject to issuance of license, except
that On or after the first day of June, one thousand nine hundred
ninety, no solicitor's license will be issued which is not a
renewal of an existing license;
(b) (7) Does not intend to use the license principally for the
purpose, in the case of life or accident and sickness insurance, of
procuring insurance on himself or herself, members of his or her
family or his or her relatives; or, as to insurance other than life
and accident and sickness, upon his or her property or insurable
interests of those of his or her family or his or her relatives or
those of his or her employer, employees or firm, or corporation in
which he or she owns a substantial interest, or of the employees of
the firm or corporation, or on property or insurable interests for
which the applicant or any relative, employer, firm or corporation
is the trustee, bailee or receiver. For the purposes of this
provision, a vendor's or lender's interest in property sold or being sold under contract or which is the security for any loan,
shall not be deemed considered to constitute property or an
insurable interest of the vendor or lender.
(e) (8) Satisfies the commissioner that he or she is
trustworthy and competent. The commissioner may test the
competency of an applicant for a license under this section by
examination. Each examinee shall pay a twenty-five dollar
examination fee for each examination to the commissioner who shall
deposit said examination fee into the state treasury for the
benefit of the state fund, general revenue. The commissioner may,
at his or her discretion, designate an independent testing service
to prepare and administer the examination subject to direction and
approval by the commissioner, and examination fees charged by the
service shall be paid by the applicant. In addition to examination
fees charged by the independent testing service, the independent
testing service shall collect and remit to the commissioner the
twenty-five dollar examination fee.
(f) (9) For new agents first licensed on or after the first
day of July, one thousand nine hundred eighty-nine, completes a
program of insurance education as established in section seven,
article twelve, section eight below of this chapter. Provided, That a written waiver from the insurance education requirements for
life, accident and sickness, or property and casualty insurance may
be granted to any person who can demonstrate to the satisfaction of
the commissioner that he or she has been licensed as a resident
agent in good standing in another state within the sixty-day period
immediately preceding his or her application for a resident license
in West Virginia. The waiver, if granted, does not exempt the
applicant from an examination pertaining to the laws of this state
for each kind of insurance for which application is made.
(b) A business entity acting as an insurance agency is
required to obtain an insurance producer license. Application
shall be made using the uniform business entity application. Before
approving the application, the insurance commissioner shall find
that:
(1) The insurance agency has disclosed to the insurance
commissioner all officers, partners, and directors, whether or not
they are licensed as insurance producers;
(2) The insurance agency's officers, directors, or partners
are trustworthy, of good moral character and of good business
reputation;
(3) The insurance agency has paid the fees set forth in section ten, article twelve of this chapter;
(4) The insurance agency has designated an individual licensed
producer who is an officer, partner, or director responsible for
the insurance agency's or business entity's compliance with the
insurance laws and rules of this state;
(5) The insurance agency has registered with the commissioner
the name of each natural person who, as an officer, director,
partner, owner, or member of the agency, is acting as and is
licensed as an insurance producer;
(6) The insurance agency has registered with the commissioner
the name of each natural person who, as an officer, director,
partner, owner, or member of the insurance agency or business
entity, is acting as and is licensed as an insurance producer;
(7) The insurance agency or business entity has registered
with the commissioner at least one individual who holds a valid
insurance producer license for the line or lines of authority
requested in the application;
(8) If the insurance agency's filing status is nonresident,
the insurance agency or business entity has complied with the
qualification requirements of section twelve,
article twelve of
this chapter;
(9) An insurance agency may qualify as a resident if the
agency has its principal office in this state.
(c) The insurance commissioner may require any documents
reasonably necessary to verify the information contained in an
application.
(d) Each insurer that sells, solicits or negotiates any form
of limited line credit insurance shall provide to each individual
whose duties will include selling, soliciting or negotiating
limited line credit insurance a program of instruction that may be
approved by the insurance commissioner.
There is hereby created the board of insurance agent
education. The board of insurance agent education shall consist of
the commissioner of insurance and six members appointed by the
commissioner. The members appointed by the commissioner shall be
two licensed property and casualty insurance agents, one licensed
life insurance agent, one licensed health and accident insurance
agent, one representative of a domestic insurance company, and one
representative of a foreign insurance company: Provided, That no
board shall be appointed that fails to include companies or agents
for companies representing at least two thirds of the net written
insurance premiums in the state. Each member shall serve a term of three years and shall be eligible for reappointment.
(1) The board of insurance agent education shall establish the
criteria for a program of insurance education and submit the
proposal for the approval of the commissioner on or before the
thirty-first day of December of each year.
(2) The commissioner and the board, under standards
established by the board, may approve any course or program of
instruction developed or sponsored by an authorized insurer,
accredited college or university, agents association, insurance
trade association, or independent program of instruction that
presents the criteria and the number of hours that the board and
commissioner determine appropriate for the purpose of this article.
(g) The commissioner may issue a provisional license to any
agent applicant meeting the qualifications set forth in section two
of this article, but who has not been appointed as agent by a
licensed insurer.
(1) Notwithstanding other provisions of the code to the
contrary, an individual so licensed:
(A) May not solicit, negotiate, effect or countersign
insurance contracts or otherwise transact insurance;
(B) Is not subject to the continuing education requirements set forth in section two-a of this article; and
(C) May hold the provisional license for a period of one year
from the date of issuance.
(2) A provisional license may be upgraded to an agent's
license upon the appointment of the applicant as agent by a
licensed insurer subject to the same requirements for licensing of
agents in general.
(3) The commissioner may suspend, revoke or refuse to upgrade
a provisional license for any of the same causes and pursuant to
the same procedures as are applicable to suspension or revocation
of licenses of agents in general under article twelve of this
chapter.
(4) There shall be no fee for a provisional license.
§33-12-6a. Residency-Individuals-Agencies.
The commissioner may qualify an applicant as a resident of
this state and shall issue an insurance producer license to any
qualified resident person of this state in accordance with the
following:
(a) An individual applicant may qualify as a resident only if
he or she resides in this state. Any license issued pursuant to
any application claiming residency for licensing purposes shall constitute an election of residency in this state and shall be void
if the licensee, while holding a resident license in this state,
also holds or makes application for a license in or thereafter
claims to be a resident of any other state or jurisdiction, or if
the licensee ceases to be a resident of this state.
(b) An insurance agency or business entity may qualify as a
resident if the agency has its principal office in this state;
(c) The resident person is in compliance with the requirements
of section six of this article.
§33-12-6b. Licensing of agencies.
(a) For the purposes set forth in section twenty-three
,
article twelve of this chapter, an insurance agency shall be
licensed as an insurance producer.
(b) The insurance agency shall maintain a current list with
the name of every individual who, as a member, officer, director,
stockholder, owner or employee of the insurance agency, is acting
as and is licensed as an insurance producer. Each insurance agency
shall make such list available to the commissioner upon reasonable
request for purposes of conducting investigations and enforcing the
provisions of this chapter.
(c) The insurance agency shall, within ten days, notify the commissioner, on a form prescribed by the commissioner, of every
change relative to the licensed individual insurance producers
registered and authorized to act as insurance producers for the
insurance agency.
(d) The insurance agency shall, within ten days, notify the
commissioner, on a form prescribed by the commissioner, of any
change relative to the insurance agency or business entity name,
officers, directors, partners, or owners, to report a merger, or
that the insurance agency or business entity has ceased doing
business in this state.
(e) When an insurance agency ceases to do business in this
state, the insurance agency shall return the producer license to
the commissioner within ten days after ceasing to do business.
(f) When an insurance agency changes its principal address to
another state, the insurance agency shall, within ten days, notify
the commissioner and return the producer license for cancellation.
Relicensing will be subject to section twelve, article twelve of
this chapter.
(g) (1) The insurance agency shall comply with section six,
article twelve of this chapter.
(2) A nonresident insurance agency shall also comply with the qualification requirements of section thirty-three, article twelve
of this chapter.
(h) The provisions of this section become effective on or
after the first day of July, two thousand three.
§33-12-7. board of insurance agent education.
The board of insurance agent education shall continue in
existence. The board of insurance agent education shall consist of
the commissioner of insurance and six members appointed by the
commissioner. The members appointed by the commissioner shall be
two licensed property and casualty insurance agents, one licensed
life insurance agent, one licensed health and accident insurance
agent, one representative of a domestic insurance company, and one
representative of a foreign insurance company: Provided, That no
board shall be appointed that fails to include companies or agents
for companies representing at least two thirds of the net written
insurance premiums in the state. Each member shall serve a term of
three years and shall be eligible for reappointment.
(a) The board of insurance agent education shall establish the
criteria for a program of insurance education and submit the
proposal for the approval of the commissioner on or before the
thirty-first day of December of each year.
(b) The commissioner and the board, under standards
established by the board, may approve any course or program of
instruction developed or sponsored by an authorized insurer,
accredited college or university, agents association, insurance
trade association, or independent program of instruction that
presents the criteria and the number of hours that the board and
commissioner determine appropriate for the purpose of this article.
§33-12-8. Continuing education required.
The purpose of this provision is to provide continuing
education under guidelines set up under the insurance
commissioner's office, with the guidelines to be set up under the
board of insurance agent education. Nothing in this section
prohibits an individual from receiving commissions which have been
vested and earned while that individual maintained an approved
insurance agent's license.
(a) This section applies to individual producers persons
licensed to engage in the sale of the following types of insurance:
(1) Life insurance, annuity contracts, variable annuity
contracts and variable life insurance;
(2) Sickness, accident and health insurance;
(3) All lines of property and casualty insurance; and
(4) All other lines of insurance for which an examination is
required for licensing.
(1) Life insurance coverage on human lives including benefits
of endowment and annuities, and may include benefits in the event
of death or dismemberment by accident and benefits for disability
income;
(2) Accident and health or sickness-insurance coverage for
sickness, bodily injury or accidental death and may include
benefits for disability income;
(3) Property insurance coverage for the direct or
consequential loss or damage to property of every kind;
(4) Casualty-insurance coverage against legal liability,
including that for death, injury or disability or damage to real or
personal property;
(5) Variable life and variable annuity products-insurance
coverage provided under variable life insurance contracts and
variable annuities;
(6) Personal lines-property and casualty insurance coverage
sold to individuals and families for primarily noncommercial
purposes; and
(7) Any other line of insurance permitted under state laws or regulations.
(b) This section does not apply to:
(1) Persons Individual producers
holding residences licenses
limited line credit insurance licenses for any kind or kinds of
insurance offered in connection with loans or other credit
transactions or insurance for which an examination is not required
by the commissioner, nor does it apply to any limited or restricted
license as the commissioner may exempt; and
(2) Individuals Individual producers selling credit life or
credit accident and health insurance.
(c) (1) The board of insurance agent education as established
by section two section seven of this article shall develop a
program of continuing insurance education and submit the proposal
for the approval of the commissioner on or before the thirty-first
day of December of each year. Each year after the first day of
July, two thousand one, the program shall contain a requirement
that any person appointed to be an agent on behalf of a licensed
health maintenance organization at any time during the relevant
triennium must, as a component of his or her mandatory continuing
insurance education, complete a minimum of six hours of continuing
insurance education during the triennium which is on topics specific to health maintenance organizations. No program may be
approved by the commissioner that includes a requirement that any
agent complete more than twenty-four hours of continuing insurance
education triennially biennially. No program may be approved by
the commissioner that includes a requirement that any of the
following individuals individual producers complete more than six
hours of continuing insurance education triennially biennially:
(A) Individual insurance producers agents who sell only
preneed burial insurance contracts; and
(B) Individual insurance producers agents
(C) The biennium mandatory continuing insurance education
provisions of this section become effective on the reporting period
beginning the first day of July, two thousand three.
(2) The commissioner and the board, under standards
established by the board, may approve any course or program of
instruction developed or sponsored by an authorized insurer,
accredited college or university, agents' association, insurance
trade association or independent program of instruction that presents the criteria and the number of hours that the board and
commissioner determine appropriate for the purpose of this section.
(d) Individuals insurance producers Persons licensed to sell
insurance and who are not otherwise exempt shall satisfactorily
complete the courses or programs of instructions the commissioner
may prescribe.
(e) Every individual insurance producer, person subject to
the continuing education requirements shall furnish, at intervals
and on forms as may be prescribed by the commissioner, written
certification listing the courses, programs or seminars of
instruction successfully completed by the person. The
certification shall be executed by, or on behalf of, the
organization sponsoring the courses, programs or seminars of
instruction.
(f) Any individual insurance producer, person failing to meet
the requirements mandated in this section, and who has not been
granted an extension of time, with respect to such the
requirements, or who has submitted to the commissioner a false or
fraudulent certificate of compliance shall have his or her license
automatically suspended and no further license may be issued to the
person for any kind or kinds of insurance until the person demonstrates to the satisfaction of the commissioner that he or she
has complied with all of the requirements mandated by this section
and all other applicable laws or rules.
(g) The commissioner shall notify the individual insurance
producer person of his or her suspension pursuant to subsection (f)
of this section by certified mail, return receipt requested, to the
last address on file with the commissioner pursuant to section
nine, subsection (e) of this article. Any individual insurance
producer person who has had a suspension order entered against him
or her pursuant to this section may, within thirty calender days of
receipt of the order, file with the commissioner a request for a
hearing for reconsideration of the matter.
(h) Any person individual insurance producer
who does not
satisfactorily demonstrate compliance with this section and all
other laws applicable thereto as of the last day of the triennium
biennium following his or her suspension shall have his or her
license automatically canceled and is subject to the education and
examination requirements of section two five of this article.
(i) The commissioner is authorized to hire personnel and make
reasonable expenditures considered necessary for purposes of
establishing and maintaining a system of continuing education for insurers. The commissioner shall charge a fee of twenty-five
dollars to continuing education providers for each continuing
education course submitted for approval which shall be used to
maintain the continuing education system. The commissioner may, at
his or her discretion, designate an outside administrator to
provide all of or part of the administrative duties of the
continuing education system subject to direction and approval by
the commissioner. The fees charged by the outside administrator
shall be paid by the continuing education providers. In addition
to fees charged by the outside administrator, the outside
administrator shall collect and remit to the commissioner the
twenty-five dollar course submission fee.
§33-12-9. Issuance of license.
(a) Unless denied licensure pursuant to article twenty-four of
this chapter, individuals who have met the requirements of articles
five and six of this chapter shall be issued an insurance producer
license. An insurance producer may receive qualification for a
license in one or more of the following lines of authority:
(1) Life insurance coverage on human lives including benefits
of endowment and annuities, and may include benefits in the event
of death or dismemberment by accident and benefits for disability income.
(2) Accident and health or sickness-insurance coverage for
sickness, bodily injury or accidental death and may include
benefits for disability income.
(3)Property insurance coverage for the direct or consequential
loss or damage to property of every kind.
(4) Casualty-insurance coverage against legal liability,
including that for death, injury or disability or damage to real or
personal property.
(5) Variable life and variable annuity products-insurance
coverage provided under variable life insurance contracts and
variable annuities.
(6) Personal lines-property and casualty insurance coverage
sold to individuals and families for primarily noncommercial
purposes.
(7) Credit-limited line credit insurance.
(8) Any other line of insurance permitted under state laws or
regulations.
(b) An insurance producer license shall remain in effect
unless revoked or suspended as long as the fee set forth in section
thirteen
, article three of this chapter is paid and education requirements for resident individual producers are met by the due
date.
(c) An individual insurance producer who allows his or her
license to lapse may, within twelve months from the due date of the
renewal fee, reinstate the same license without the necessity of
passing a written examination. However, a penalty in the amount of
double the unpaid renewal fee shall be required for any renewal fee
received after the due date.
(d) An individual licensed insurance producer who is unable to
comply with license renewal procedures due to military service or
some other extenuating circumstance (e.g., a long-term medical
disability) may request a waiver of those procedures. The producer
may also request a waiver of any examination requirement or any
other fine or sanction imposed for failure to comply with renewal
procedures.
(e) The license shall contain the licensee's name, address,
personal identification number, and the date of issuance, the lines
of authority, the expiration date and any other information the
insurance commissioner considers necessary.
(f) Licensees shall inform the insurance commissioner by any
means acceptable to the insurance commissioner of a change of address or residency within thirty days of the change. Failure to
timely inform the insurance commissioner of a change in legal name,
residency or address may result in a penalty pursuant to section
twenty-four,
article twelve of this chapter. The commissioner
shall maintain the mailing address of each agent, insurance agency,
solicitor and service representative on file.
(g) In order to assist in the performance of the insurance
commissioner's duties, the insurance commissioner may contract with
nongovernmental entities, including the National Association of
Insurance Commissioner (NAIC) or any affiliates or subsidiaries
that the NAIC oversees, to perform any ministerial functions,
including the collection of fees, related to producer licensing
that the insurance commissioner and the nongovernmental entity may
consider appropriate.
§33-12-10. Fees.
The fee for an agent's license shall be twenty-five dollars as
provided in section thirteen, article three of this chapter, the
fee for a solicitor's license shall be twenty-five dollars, and the
fee for a broker's license shall be twenty-five dollars the fee for
an insurance agency producer license shall be two hundred dollars.
The commissioner shall receive the following fees from insurance agents, brokers, solicitors, insurance agencies and excess line
brokers: For letters of certification, five dollars; for letters
of clearance, ten dollars; for duplicate license, five dollars.
All fees and moneys so collected shall be used for the purposes set
forth in section thirteen, article three of this chapter.
§33-12-11. Countersignature.
No contract of insurance covering a subject of insurance,
resident, located, or to be performed in this state, shall be
executed, issued or delivered by any insurer unless the contract,
or in the case of an interstate risk a countersignature endorsement
carrying full information as to the West Virginia risk, is signed
or countersigned in writing by a licensed resident agent of the
insurer except that excess line insurance shall be countersigned by
a duly licensed excess line broker. This section does not apply
to: Reinsurance; credit insurance; any contract of insurance
covering the rolling stock of any railroad or covering any vessel,
aircraft or motor carrier used in interstate or foreign commerce,
or covering any liability or other risks incident to the ownership,
maintenance or operation thereof; any contract of insurance
covering any property in interstate or foreign commerce, or any
liability or risks incident thereto. Countersignature of a duly licensed resident agent of the company originating a contract of
insurance participated in by other companies as cosureties or
coindemnitors shall satisfy all countersignature requirements in
respect to such contract of insurance.
§33-12-12. Nonresident licensing.
(a) Nonresidents otherwise complying with the provisions of
this chapter may be licensed as life agents but all policies issued
as a result of solicitation on the part of such nonresidents in the
state, shall be reported, placed, countersigned, and consummated by
and through a duly licensed resident agent of the issuing insurer.
(b) An individual otherwise complying with the provisions of
this chapter, who is a resident of another state and who is a
licensed accident and sickness agent of such state, may be licensed
as a nonresident accident and sickness agent in this state, if the
state of residence of such nonresident has established, by law or
regulation like requirements for the licensing of a resident of
this state as a nonresident accident and sickness agent. All
policies issued as a result of solicitation by such nonresident
accident and sickness agents shall be reported, placed,
countersigned and consummated by and through a duly licensed
resident agent of the issuing insurer.
(a) Unless denied licensure pursuant to section twenty-four,
a nonresident person shall receive a nonresident producer license
if:
(1) The person is currently licensed as a resident and in good
standing in his or her home state;
(2) The person has submitted the proper request for licensure
and has paid the fees required by section thirteen,
article three
of this chapter;
(3) The nonresident person holds a similar license that is
awarded on the same basis in the nonresident's home state and for
the same line or lines of authority applied for in this state;
(4) The person has submitted or transmitted to the insurance
commissioner the application for licensure that the person
submitted to his or her home state, or in lieu of the same, a
completed uniform application; and
(5) The person's home state awards nonresident producer
licenses to residents of this state on the same basis.
(b) An insurance agency may qualify as a nonresident if the
agency has its principal office located in another state.
(c) The insurance commissioner may verify the producer's
licensing status through the producer database maintained by the National Association of Insurance Commissioners, its affiliates or
subsidiaries.
(d) A nonresident producer who moves from one state to another
state or a resident producer who moves from this state to another
state shall file a change of address and provide certification from
the new resident state within thirty days of the change of legal
residence. No fee or license application is required.
(e) If the insurance department of the nonresident insurance
producer's resident state suspends, terminates, or revokes the
producer's insurance license in that state, the nonresident
insurance producer shall notify the commissioner and shall return
the West Virginia nonresident license.
(f) Notwithstanding any other provision of this article, an
individual licensed as a surplus lines producer in his or her home
state shall receive a nonresident surplus lines producer license
pursuant to subsection (a) of this section. Except as to
subsection (a), nothing in this section otherwise amends or
supercedes any provision of sections one through fourteen,
article
twelve (c) of this chapter.
(g) Notwithstanding any other provision of this article, an
individual licensed as a limited line credit insurance or other type of limited lines producer in his or her home state shall
receive a nonresident limited lines producer license, pursuant to
subsection (a) of this section, granting the same scope of
authority as granted under the license issued by the producer's
home state. For the purposes of section twelve subsection(e),
limited line insurance is any authority granted by the home state
which restricts the authority of the license to less than the total
authority prescribed in the associated major lines pursuant to
subdivisions (1) through (6), subsection (a), section nine,
article
twelve
of this chapter.
§33-12-13. Agent resident in contiguous municipalities.
An agent who has his or her residence in an urban community
composed of two immediately contiguous municipal corporations not
separated by a river or other stream, one of which is located in
this state and the other located in another state, shall be
considered a resident of this state for the purposes of this
article if his or her residence is in any part of such urban
community and the state wherein the other municipal corporation is
located has established by law or regulation like requirements as
to residence of agents in such urban community.
§33-12-14. Exemption from examination.
(a) An individual who applies for an insurance producer
license in this state who was previously licensed for the same
lines of authority in another state shall not be required to
complete any prelicensing education or examination. This exemption
is only available if the individual is currently licensed in that
state or if the application is received within ninety days of the
cancellation of the applicant's previous license and if the prior
state issues a certification that, at the time of cancellation, the
applicant was in good standing in that state or the state's
producer database records, maintained by the National Association
of Insurance Commissioners, its affiliates or subsidiaries,
indicate that the producer is or was licensed in good standing for
the line of authority requested.
(b) An individual licensed as an insurance producer in
another state who moves to this state shall make application within
ninety days of establishing legal residence to become a resident
licensee pursuant to section five of this article. No
prelicensing education or examination shall be required of that
individual to obtain any line of authority previously held in the
prior state except where the insurance commissioner determines
otherwise by regulation.
§33-12-15. Assumed names.
An insurance producer doing business under any name other than
the producer's legal name is required to notify the insurance
commissioner prior to using the assumed name.
§33-12-16. Temporary licensing.
(a) The insurance commissioner may issue an individual a
temporary insurance producer license for a period not to exceed one
hundred eighty days without requiring an examination if the
insurance commissioner considers that the temporary license is
necessary for the servicing of an insurance business in the
following cases:
(1) To the surviving spouse or court-appointed personal
representative of a licensed insurance producer who dies or becomes
mentally or physically disabled to allow adequate time for the sale
of the insurance business owned by the producer or for the recovery
or return of the producer to the business or to provide for the
training and licensing of new personnel to operate the producer's
business;
(2) To the designee of a licensed insurance producer entering
active service in the armed forces of the United States of America;
or
(3) In any other circumstance where the insurance commissioner
considers that the public interest will best be served by the
issuance of this license.
(b) The insurance commissioner may by order limit the
authority of any temporary licensee in any way considered necessary
to protect insureds and the public. The insurance commissioner may
require the temporary licensee to have a suitable sponsor who is a
licensed producer or insurer and who assumes responsibility for all
acts of the temporary licensee and may impose other similar
requirements designed to protect insureds and the public. The
insurance commissioner may by order revoke a temporary license if
the interest of insureds or the public are endangered. A temporary
license may not continue after the owner or the personal
representative disposes of the business.
§33-12-17. Expiration of license; renewal.
All licenses of agents and solicitors shall expire at midnight
on the May thirty-first next following the date of issuance. The
commissioner shall renew annually the license of all such licensees
who qualify and make application therefor.
(a) The commissioner may, in his or her discretion, fix the
dates of expiration of respective licenses for individual insurance producers and solicitors in such manner as is considered by him or
her to be advisable for an efficient distribution of the work load
of his or her office. If the expiration date so fixed would upon
first occurrence shorten the period for which license fee has
theretofore been paid, no refund of unearned fee shall be made; and
if the expiration date so fixed would upon first occurrence
lengthen the period for which license fee had theretofore been
paid, the commissioner shall charge no additional fee for such
lengthened period. If another date is not so fixed by the
commissioner, each such license shall, unless continued as herein
above provided, expire at midnight on the thirty-first of May next
following the date of issuance. The commissioner shall renew
annually on the date as provided for in this section the license of
the licensee who qualifies and makes application therefor, and has
paid the fees set forth in section thirteen,
article three of this
chapter; and section ten,
article twelve of this chapter.
(b) All producer licenses of insurance agencies shall expire
at midnight on the thirtieth day of
June next following the date of
issuance. The commissioner shall renew annually the license of all
such licensees who qualify and make application therefor and has
paid the fees set forth in section ten,
article twelve of this chapter.
§33-12-18. Agent to deal only with licensed insurer,
broker or
solicitor; appointment as agent required prior to
transacting business.
(a) An agent may not accept any risk, place any insurance or
issue any policy except with an insurer licensed in this state and
for which insurer such agent has been appointed and licensed.
(b) An agent may not accept any contract of insurance from any
broker not licensed in this state.
(c) An agent may not employ or accept the services of any
solicitor not duly appointed and licensed as solicitor for such
agent.
(d) An agent may not solicit, market, sell or transact any
business of any kind on behalf of any insurer until after the agent
has been appointed as agent for that insurer pursuant to the
provisions of this article and such appointment has been approved
by the commissioner of insurance.
(e) Notwithstanding any other provision in this section to the
contrary, an agent may, without an appointment, submit to an
insurer an inquiry and obtain a bid for any kind of life insurance,
health insurance or annuity for which the agent has a valid and
effective license if due insurer has a valid and effective certificate of authority under this article for the kind of
insurance with respect to which the inquiry is made.
(a) An individual insurance producer shall not act as an agent
of an insurer unless the insurance producer becomes an appointed
agent of that insurer. An insurance producer who is not acting as
an agent of an insurer is not required to become appointed.
(b) To appoint an individual producer as its agent, the
appointing insurer shall file, in a format approved by the
insurance commissioner, a notice of appointment within fifteen days
from the date the agency contract is executed or the first
insurance application is submitted. An insurer may also elect to
appoint an individual producer to all or some insurers within the
insurer's holding company system or group by the filing of a single
appointment request.
(c) Upon receipt of the notice of appointment, the insurance
commissioner shall verify within a reasonable time, not to exceed
thirty days, that the individual insurance producer is eligible for
appointment. If the individual insurance producer is determined to
be ineligible for appointment, the insurance commissioner shall
notify the insurer within five days of its determination.
(d) An insurer shall pay a nonrefundable appointment processing fee, in the amount and method of payment set forth in
section thirteen,
article three of this chapter, for each insurance
producer appointment notification submitted by the insurer to the
commissioner.
(e) An insurer shall remit, in a manner prescribed by the
insurance commissioner, a renewal appointment fee in the amount set
forth in section thirteen,
article three of this chapter no later
than midnight thirty-first day of
May annually.
(f) Each insurer shall maintain a current list of individual
insurance producers appointed to accept applications on behalf of
the insurer. Each insurer shall make such list available to the
commissioner upon reasonable request for purposes of conducting
investigations and enforcing the provisions of this chapter.
(g) Insurance agencies licensed as producers are not subject
to the provisions of this section.
§33-12-19. Solicitor to act only through appointed agent.
A solicitor shall solicit and receive applications for
insurance only for the duly licensed agent who appointed such the
solicitor, and shall report all business through such agent. The
expiration, cancellation, suspension or revocation of the license
of the appointing agent shall automatically expire, cancel, suspend or revoke the solicitor's license in like manner, and the
appointing agent may cancel a solicitor's license at any time by
written request to the commissioner. No agent may apply for
licenses for more than two solicitors. No solicitors shall be
permitted for life insurance agents.
§33-12-20. Personal liability of agent.
Any agent or broker who participates directly or indirectly in
effecting any insurance contract, except authorized reinsurance,
upon any subject of insurance resident, located or to be performed
in this state, where the insurer is not licensed to transact
insurance in this state, shall be personally liable upon such
contract as though such the
agent or broker were the insurer
thereof. This section shall may not apply to excess line insurance
procured in the manner provided in sections ten to seventeen,
inclusive, of this article twelve-c, of this chapter, nor to ocean
marine insurance or marine protection and indemnity insurance.
§33-12-21. Coverage must be placed with a solvent insurer.
No agent, broker or excess line broker shall knowingly place
any coverage in an insolvent insurer.
§33-12-22. Person soliciting insurance is agent of insurer.
Any person who shall solicit within this state an application
for insurance shall, in any controversy between the insured or his beneficiary and the insurer issuing any policy upon such an
application, be regarded as the agent of such the
insurer and not
the agent of the insured.
§33-12-23. Payment of commissions.
(a) The entire commission payable by any insurer licensed to
transact insurance in this state on any insurance policy shall be
paid directly to the licensed resident agent who countersigns the
policy. The countersigning agent shall not pay any part of such
the
commission to any person other than a licensed agent: or
broker: Provided, That the portion of such the
commission retained
by the countersigning resident agent shall may not be less than ten
percent of the gross policy premium or fifty percent of the
commission payable by the insurer as provided herein, whichever is
the lesser amount. The term "commission" as used herein shall
include engineering fees, service fees or any other compensation
incident to the issuance of a policy payable by or to any insurer
or agent. or broker.
(b) It shall be unlawful for any insurer or agent to pay, and
any person to accept, directly or indirectly, any commission except
as provided in this section: Provided, That any licensed resident
agent may pay his or her commissions, or direct that his or her commissions be paid, to a business entity licensed as an insurance
producer a partnership of which he is a member, employee or agent,
or to a corporation of which he is an officer, employee or agent,
if:
(1) The commissioner finds that such business entity
partnership or corporation is engaged, through its licensed
resident agents, in conducting an insurance agency business with
respect to the general public; and
(2) If a partnership licensed as an insurance agency producer,
each partner satisfies the commissioner that he meets the licensing
qualifications as set forth in section two six of this article.
(3) If a corporation licensed as an insurance agency producer,
each officer, employee or any one or more stockholders owning,
directly or indirectly, the controlling interest in such
corporation satisfies the commissioner that he or she meets the
licensing qualifications as set forth in section two six of this
article. The requirements set forth in this subdivision shall not
apply to clerical employees, or other employees not directly
engaged in the selling or servicing of insurance.
(4) If a limited liability company licensed as an insurance
agency producer, each officer, employee or any one or more members owning, directly or indirectly, the controlling interest in a
limited liability company satisfies the commissioner that he or she
meets the licensing qualifications as set forth in section six of
this article. The requirements set forth in this subdivision may
not apply to clerical employees, or other employees not directly
engaged in the selling or servicing of insurance.
(5) If another business entity licensed as an insurance agency
producer, approval is granted by the commissioner.
(c) This section shall not apply to reinsurance, or life
insurance, or accident and sickness insurance; nor to excess line
insurance procured in accordance with the provisions of this
article twelve-c relating thereto; nor to credit insurance, any
contract of insurance covering the rolling stock of any railroad or
covering any vessel, aircraft or motor carrier used in interstate
or foreign commerce, any liability or other risks incident to the
ownership, maintenance or operation thereof, any contract of
insurance covering any property in interstate or foreign commerce,
or any liability or risks incident thereto.
(d) An insurance company or insurance producer shall not pay
a commission, service fee, brokerage or other valuable
consideration to a person for selling, soliciting or negotiating insurance in this state if that person is required to be licensed
under this article and is not so licensed.
(e) A person may not accept a commission, service fee,
brokerage or other valuable consideration for selling, soliciting
or negotiating insurance in this state if that person is required
to be licensed under this article and is not so licensed.
(f) Renewal or other deferred commissions may be paid to a
person for selling, soliciting or negotiating insurance in this
state if the person was required to be licensed under this article
at the time of the sale, solicitation or negotiation and was so
licensed at that time.
§33-12-24. Revocation, suspension or refusal to renew license;
penalty.
(a) The commissioner may revoke or suspend the license of any
agent, solicitor, broker or excess line broker if, after notice to
the licensed person and hearing, the commissioner determines such
person has:
(1) Violated any insurance law or any lawful rule, regulation,
or order of the commissioner;
(2) Improperly withheld, misappropriated, or converted to his
own use any money received in the course of business and belonging
to policyholders, insurers, beneficiaries, or others;
(3) Misrepresented the terms of any existing or proposed
insurance contract to the detriment of the applicant or insured;
(4) Engaged in any pattern of unfair method of competition or
unfair or deceptive acts or practices in the business of insurance
as defined in article eleven of this chapter;
(5) Forged another person's name to an application for
insurance or to any other document or fraudulently procured a
forged signature to an insurance application or any other document,
knowing such signature to be forged;
(6) Knowingly and willfully made or permitted a false or
fraudulent statement or misrepresentation in or relative to an
application for a policy of insurance;
(7) Been convicted of or pleaded nolo contendere to any
felony;
(8) Been convicted of or pleaded nolo contendere to a
misdemeanor in connection with his activities as an agent,
solicitor, broker or excess line broker;
(9) Obtained the license for the purpose of writing controlled
business, as described in subsection (d), section two of article
twelve of this chapter;
(10) Had an agent's or broker's license suspended or revoked in any other state, district, or territory of the United States or
any province of Canada;
(11) Not demonstrated trustworthiness and competency in his
activities as an agent, solicitor, broker or excess line broker; or
(12) Obtained the license through misrepresentation, fraud, or
any other act for which issuance of the license could have been
refused had it been known to the commissioner at the time of
issuance.
(b) In lieu of revoking or suspending such license, the
commissioner may in his discretion order such licensee to pay to
the state of West Virginia a penalty in a sum not to exceed one
thousand dollars and upon the failure of such licensee to pay such
penalty by delivery of such sum to the commissioner within thirty
days of notice thereof, the commissioner shall revoke or suspend
such license.
(a) The commissioner may examine and investigate the business
affairs and conduct of every person applying for or holding an
insurance producer license, solicitor's license or excess line
broker's license to determine whether the person has been or is
engaged in any violation of the insurance laws or rules of this
state or has engaged in unfair or deceptive acts or practices in any state.
(b) The insurance commissioner may place on probation,
suspend, revoke or refuse to issue or renew an insurance producer's
license, solicitor's license or excess line broker's license, or
may levy a civil penalty or any combination of actions, for any one
or more of the following causes:
(1) Providing incorrect, misleading, incomplete or materially
untrue information in the license application;
(2) Violating any insurance laws, or violating any regulation,
subpoena or order of the insurance commissioner or of another
state's insurance commissioner;
(3) Obtaining or attempting to obtain a license through
misrepresentation or fraud;
(4) Improperly withholding, misappropriating or converting any
moneys or properties received in the course of doing insurance
business;
(5) Intentionally misrepresenting the terms of an actual or
proposed insurance contract or application for insurance;
(6) Having been convicted of or pleaded nolo contendere to any
felony;
(7) Been convicted of or pleaded nolo contendere to a misdemeanor in connection with his or her activities as an agent,
solicitor, or excess line broker;
(8) Having admitted or been found to have committed any
insurance unfair trade practice or fraud;
(9) Using fraudulent, coercive or dishonest practices, or
demonstrating incompetence, untrustworthiness or financial
irresponsibility in the conduct of business in this state or
elsewhere;
(10) Having an insurance producer license, solicitor license,
excess line broker license or its equivalent, denied, suspended or
revoked in any other state, province, district or territory;
(11) Forging another's name to an application for insurance or
to any document related to an insurance transaction or fraudulently
procured a forged signature to an insurance application or any
other document, knowing the signature to be forged;
(12) Improperly using notes or any other reference material to
complete an examination for an insurance producer license;
(13) Knowingly accepting insurance business from an individual
who is not licensed;
(14) Failing to comply with an administrative or court order
imposing a child support obligation;
(15) Having a statutory lien recorded for failing to pay state
income tax or comply with any administrative or court order
directing payment of state income tax; or
(16) Obtained the license for the purpose of writing
controlled business, as described in subdivision (7), subsection
(a), section six, article twelve of this chapter;
(c) In the event that the action by the insurance commissioner
is to nonrenew or to deny an application for a license, the
insurance commissioner shall notify the applicant or licensee and
advise, in writing, the applicant or licensee of the reason for the
denial or nonrenewal of the applicant's or licensee's license. The
applicant or licensee may make written demand upon the insurance
commissioner within ten days for a hearing before the insurance
commissioner to determine the reasonableness of the insurance
commissioner's action. The hearing shall be held within forty-five
days and shall be held pursuant to section thirteen,
article two of
this chapter.
(d) The producer's license of a business entity may be placed
on probation, suspended, revoked, refused or have civil penalty or
any combination of actions, if the insurance commissioner finds,
after hearing, that an individual licensee's violation was known or should have been known by one or more of the partners, officers or
managers acting on behalf of the partnership or corporation and the
violation was neither reported to the insurance commissioner nor
corrective action taken.
(e) In addition to or in lieu of any applicable denial,
probation, suspension or revocation of a license, a person may,
after hearing, be subject to a civil penalty in a sum not to exceed
five thousand dollars. Upon the failure of the
licensee to pay the
penalty by delivery of the sum to the commissioner within thirty
days of notice thereof, the commissioner shall revoke or suspend
the license.
(f) The insurance commissioner shall retain the authority to
enforce the provisions of and impose any penalty or remedy
authorized by this article against any person even if the person's
license or registration has been surrendered or has lapsed by
operation of law.
§33-12-25. Termination of authority to represent insurer.
(a) An insurer shall give to the commissioner and the agent,
on a form prescribed by the commissioner, written notice of the
termination of an agent's authority to represent the insurer within
five working days of the termination. The notice of termination shall state the cause and circumstances of such termination.
(b) In the absence of fraud or bad faith, there shall be no
liability on the part of, and a cause of action of any nature shall
not arise against the commissioner or his employees, or an insurer
or its employees for any information furnished pursuant to this
section.
(a) Termination for cause. -- An insurer or authorized
representative of the insurer that terminates the appointment,
employment, contract or other insurance business relationship with
a producer shall notify the insurance commissioner within thirty
days following the effective date of the termination, using a
format prescribed by the insurance commissioner, if the reason for
termination is one of the reasons set forth in section twenty-four,
article twelve of this chapter or the insurer has knowledge the
producer was found by a court, government body, or self-regulatory
organization authorized by law to have engaged in any of the
activities in section twenty-four,
article twelve of this chapter.
Upon the written request of the insurance commissioner, the insurer
shall provide additional information, documents, records or other
data pertaining to the termination or activity of the producer.
(b) Termination without cause. -- An insurer or authorized representative of the insurer that terminates the appointment,
employment, or contract with a producer for any reason not set
forth in section twenty-four,
article twelve of this chapter, shall
notify the insurance commissioner within thirty days following the
effective date of the termination, using a format prescribed by the
insurance commissioner. Upon written request of the insurance
commissioner, the insurer shall provide additional information,
documents, records or other data pertaining to the termination.
(c) Ongoing notification requirement. -- The insurer or the
authorized representative of the insurer shall promptly notify the
insurance commissioner in a format acceptable to the insurance
commissioner if, upon further review or investigation, the insurer
discovers additional information that would have been reportable to
the insurance commissioner in accordance with subsection (a) of
this section, had the insurer then known of its existence.
(d) Copy of notification to be provided to producer. --
(1) At the time of making the notification required by
subsections (a), (b) and (c) of this section, the insurer shall
simultaneously mail a copy of the notification to the producer at
his or her last known address. If the producer is terminated for
cause for any of the reasons listed in section twenty-four,
article twelve of this chapter, the insurer shall provide a copy of the
notification to the producer at his or her last known address by
certified mail, return receipt requested, postage prepaid or by
overnight delivery using a nationally recognized carrier.
(2) Within thirty days after the producer has received the
original or additional notification, the producer may file written
comments concerning the substance of the notification with the
insurance commissioner. The producer shall, by the same means,
simultaneously send a copy of the comments to the reporting
insurer, and the comments shall become a part of the insurance
commissioner's file and accompany every copy of a report
distributed or disclosed for any reason about the producer as
permitted under subsection (f) of this section.
(e) Immunities.--
(1) In the absence of actual malice, an insurer, the
authorized representative of the insurer, a producer, the insurance
commissioner, or an organization of which the insurance
commissioner is a member and that compiles the information and
makes it available to other insurance commissioners or regulatory
or law-enforcement agencies shall not be subject to civil
liability, and a civil cause of action of any nature may not arise against these entities or their respective agents or employees, as
a result of any statement or information required by or provided
pursuant to this section or any information relating to any
statement that may be requested in writing by the insurance
commissioner, from an insurer or producer; or a statement by a
terminating insurer or producer to an insurer or producer limited
solely and exclusively to whether a termination for cause under
subsection (a) of this section was reported to the insurance
commissioner, provided that the propriety of any termination for
cause under subsection (a) of this section is certified in writing
by an officer or authorized representative of the insurer or
producer terminating the relationship.
(2) In any action brought against a person that may have
immunity under subdivision (1) above for making any statement
required by this section or providing any information relating to
any statement that may be requested by the insurance commissioner,
the party bringing the action shall plead specifically in any
allegation that subdivision (1)
above does not apply because the
person making the statement or providing the information did so
with actual malice.
(3) Subdivision (1) or (2) above shall not abrogate or modify any existing statutory or common law privileges or immunities.
(f) Confidentiality.--
(1) Any documents, materials or other information in the
control or possession of the department of insurance that is
furnished by an insurer, producer or an employee or agent thereof
acting on behalf of the insurer or producer, or obtained by the
insurance commissioner in an investigation pursuant to this section
shall be confidential by law and privileged, shall not be subject
to chapter twenty-nine-b of this code, shall not be subject to
subpoena, and shall not be subject to discovery or admissible in
evidence in any private civil action. However, the insurance
commissioner is authorized to use the documents, materials or other
information in the furtherance of any regulatory or legal action
brought as a part of the insurance commissioner's duties.
(2) Neither the insurance commissioner nor any person who
received documents, materials or other information while acting
under the authority of the insurance commissioner shall be
permitted or required to testify in any private civil action
concerning any confidential documents, materials, or information
subject to subdivision (1) above
.
(3) In order to assist in the performance of the insurance commissioner's duties under this act, the insurance commissioner:
(A) May share documents, materials or other information,
including the confidential and privileged documents, materials or
information subject to
subdivision (1)
above with other state,
federal, and international regulatory agencies, with the National
Association of Insurance Commissioners, its affiliates or
subsidiaries, and with state, federal and international law
enforcement authorities, provided that the recipient agrees to
maintain the confidentiality and privileged status of the document,
material or other information;
(B) May receive documents, materials or information, including
otherwise confidential and privileged documents, materials or
information, from the National Association of Insurance
Commissioners, its affiliates or subsidiaries and from regulatory
and law-enforcement officials of other foreign or domestic
jurisdictions, and shall maintain as confidential or privileged any
document, material or information received with notice or the
understanding that it is confidential or privileged under the laws
of the jurisdiction that is the source of the document, material or
information; and
(C) May enter into agreements governing sharing and use of information consistent with this subsection.
(4) No waiver of any applicable privilege or claim of
confidentiality in the documents, materials, or information shall
occur as a result of disclosure to the commissioner under this
section or as a result of sharing as authorized in
subdivision
(3)
above.
(5) Nothing in this article shall prohibit the insurance
commissioner from releasing final, adjudicated actions including
for cause terminations that are open to public inspection pursuant
to chapter twenty-nine-b of this code to a database or other
clearinghouse service maintained by the National Association of
Insurance Commissioners, its affiliates or subsidiaries of the
National Association of Insurance Commissioners.
(g) Penalties for failing to report. -- An insurer, the
authorized representative of the insurer, or producer that fails to
report as required under the provisions of this section or that is
found to have reported with actual malice by a court of competent
jurisdiction may, after notice and hearing, have its license or
certificate of authority suspended or revoked and may be fined in
accordance with subsection (e), section twenty-four, article twelve
of this chapter.
§33-12-26. Insurance vending machines.
(a) A licensed resident agent may solicit applications for and
issue policies for trip accident insurance by means of mechanical
vending machines supervised by him or her, if:
(1) The commissioner finds that the kind of insurance and form
of policy to be so sold is reasonably suited for sale and issuance
through vending machines and otherwise complies with this chapter,
and that use of such the machines therefor would be of convenience
to the public; and
(2) The commissioner finds that the type of vending machines
to be used is reasonably suitable and practical for the purpose.
(b) The commissioner shall issue to the agent a special
vending machine license as to each such machine to be used. The
license shall specify name and address of the insurer and agent,
kind of insurance and type of policy to be sold, and the place
where the machine is to be in operation. The license shall expire,
be renewable, and be suspended or revoked, coincidently with that
of the agent. The license fee shall be five dollars for each year
or part thereof for each vending machine. Proof of existence of
the license shall be displayed on or about each such machine in
such a manner as the commissioner may reasonably require. Fees so collected are subject to the provisions of section thirteen of
article three of this chapter.
§33-12-27. Payment of commissions under assigned risk plan.
An insurer participating in a plan for assignment of personal
injury liability insurance or property damage liability insurance
on owner's automobiles or operators, which plan has been approved
by the commissioner, may pay a commission to a qualified agent who
is licensed to act as agent for any insurer participating in the
plan when the agent is designated by the insured as the producer of
record under an automobile assigned risk plan pursuant to which a
policy is issued under the plan, and sections eleven and
twenty-three of this article shall not be applicable thereto.
§33-12-28. Service representative permit.
Individual nonresidents of West Virginia, employed on salary
by an insurer, who enter the state to assist and advise resident
agents in the solicitation, negotiation, making or procuring of
contracts of insurance on risks resident, located or to be
performed in West Virginia shall obtain a service representative
permit. The commissioner may, upon receipt of a properly prepared
application, issue the permit without requiring a written
examination therefor. The fee for a service representative permit shall be twenty-five dollars and the permit shall expire at
midnight on the thirty-first day of March next following the date
of issuance. Issuance of a service representative permit shall not
entitle the holder to countersign policies. The representative may
not in any manner solicit, negotiate, make or procure insurance in
this state except when in the actual company of the licensed
resident agent whom he or she has been assigned to assist. All
fees collected under this section shall be used for the purposes
set forth in section thirteen, article three of this chapter.
§33-12-29. Notice of hearing before the commissioner; failure to
appear; entry of orders; appeal.
(a) When conducting any hearing authorized by section
thirteen, article two of this chapter which concerns any agent
insurance producer, solicitor, excess line broker or service
representative, the commissioner shall give notice of such the
hearing and the matters to be determined therein to such the agent
insurance producer, solicitor, excess line broker or service
representative by certified mail, return receipt requested, sent to
the last address filed by such the
person or entity pursuant to
subsection (e),
section twenty-nine of this article section nine of
this article.
(b) If an agent insurance producer, solicitor, excess line broker or service representative fails to appear at such hearing,
the hearing may proceed, at which time the commissioner shall
establish that notice was sent to such the person pursuant to this
section prior to the entry of any orders adverse to the interests
of such agent insurance producer, solicitor excess line broker or
service representative based upon the allegations against such a
person which were set forth in the notice of hearing. Certified
copies of all orders entered by the commissioner shall be sent to
the person affected therein by certified mail, return receipt
requested, at the last address filed by such the person with the
division.
(c) An agent insurance producer, solicitor, excess line broker
or service representative who fails to appear at a hearing of which
notice has been provided pursuant to this section, and who has had
an adverse order entered by the commissioner against them as a
result of their failure to so appear may, within thirty calendar
days of the entry of such the adverse order, file with the
commissioner a written verified appeal with any relevant documents
attached thereto, which demonstrates good and reasonable cause for
such the
person's failure to appear, and may request
reconsideration of the matter and a new hearing. The commissioner in his or her discretion, and upon a finding that the agent
insurance producer, solicitor, excess line broker or service
representative has shown good and reasonable cause for his or her
failure to appear, shall issue an order that the previous order be
rescinded, that the matter be reconsidered, and that a new hearing
be set.
(d) Orders entered pursuant to this section are subject to the
judicial review provisions of section fourteen, article two of this
chapter.
§33-12-30. Termination of contractual relationship prohibited.
No insurance company may cancel, refuse to renew or otherwise
terminate a written contractual relationship with any insurance
agent who has been employed or appointed pursuant to that written
contract by such an
insurance company as a result of any analysis
of a loss ratio resulting from claims paid under the provisions of
an endorsement for uninsured and underinsured motor vehicle
coverage issued pursuant to the provisions of section thirty-one,
article six of this chapter, nor may any provision of that
contract, including the provisions for compensation therein,
operate to deter or discourage the insurance agent from selling and
writing endorsements for optional uninsured or underinsured motor vehicle coverage.
§33-12-31. Termination of contractual relationship; continuation
of certain commissions; exceptions.
(a) In the event of a termination of a contractual
relationship between a duly licensed insurance agent and an
automobile insurer of private passenger automobiles who is
withdrawing from writing private passenger automobile insurance
within the state, the insurer shall pay the agent a commission,
equal to the commission the agent would have otherwise been
entitled to under his or her contract with the insurer, for a
period of two years from the date of termination of the contractual
relationship for those renewal policies that cannot otherwise be
canceled or nonrenewed pursuant to law, which policies the agent
continues to service. The insurer must continue the appointment of
the agent for the duration of time the agent continues to service
the business: Provided, That this requirement shall not obligate
the withdrawing insurer to accept any new private passenger
automobile insurance within the state.
(b) Subsection (a) of this section does not apply to an agent
who is an employee of the insurer, or an agent as defined by
article twelve-a of this chapter, or an agent, who by contractual agreement either represents only one insurer or group of affiliated
insurers or who is required by contract to submit risks to a
specified insurer or group of affiliated insurers prior to
submitting them to others.
§33-12-32. Limited licenses for rental companies.
(a) Purpose. -- This section authorizes the insurance
commissioner to issue limited licenses for the sale of automobile
rental coverage.
(b) Definitions. -- The following words when used in this
section shall have the following meanings:
(1) "Authorized insurer" means an insurer that is licensed by
the commissioner to transact insurance in West Virginia.
(2) "Automobile rental coverage" or "rental coverage" is
insurance offered incidental to the rental of vehicle as described
in this section.
(3) "Limited license" means the authorization by the
commissioner for a person to sell rental coverage as agent of an
authorized insurer pursuant to the provisions of this section
without the necessity of agent prelicensing education, examination,
or continuing education.
(4) "Limited licensee" is an individual resident of this state who obtains a limited license.
(5) "Rental agreement" means any written agreement setting
forth the terms and conditions governing the use of a vehicle
provided by the rental company for rental or lease.
(6) "Rental company" means any person or entity in the
business of providing private motor vehicles to the public under a
rental agreement for a period not to exceed ninety days.
(7) "Renter" means any person obtaining the use of a vehicle
from a rental company under the terms of a rental agreement for a
period not to exceed ninety days.
(8) "Vehicle" or "rental vehicle" means a motor vehicle of the
private passenger type including passenger vans, minivans and sport
utility vehicles and of the cargo type, including cargo vans,
pick-up trucks and trucks with a gross vehicle weight of twenty-six
thousand pounds or less and which do not require the operator to
possess a commercial driver's license.
(9) "Rental period" means the term of the rental agreement.
(c) The commissioner may issue a limited license for the sale
of automobile rental coverage to an employee of a rental company,
who has satisfied the requirements of this section.
(d) As a prerequisite for issuance of a limited license under this section, there shall be filed with the commissioner a written
application for a limited license, signed by the applicant, in such
a
form or forms and supplements thereto, and containing such the
information, as the commissioner may prescribe. The limited
licensee shall pay to the insurance commissioner an annual fee of
twenty-five dollars.
(e) The limited licensee shall be appointed by the licensed
insurer or insurers for the sale of automobile rental coverage.
The employer of the limited licensee shall maintain at each
insurance sales location a list of the names and addresses of
employees which are selling insurance at the location.
(f) In the event that any provision of this section or
applicable provisions of the insurance code is violated by a
limited licensee or other employees operating under his or her
direction, the commissioner may:
(1) After notice and a hearing, revoke or suspend a limited
license issued under this section in accordance with the provisions
of section thirteen, article two of this chapter, or
(2) After notice and hearing, impose such any
other penalties,
including suspending the transaction of insurance at specific
locations where applicable violations of the insurance code have occurred, as the commissioner deems considers to be necessary or
convenient to carry out the purposes of this section.
(g) Any limited license issued under this section shall also
authorize any other employee working for the same employer and at
the same location as the limited licensee to act individually, on
behalf, and under the supervision, of the limited licensee with
respect to the kinds of coverage authorized in this section. In
order to sell insurance products under this section at least one
employee who has obtained a limited license must be present at each
location where insurance is sold. All other employees working at
that location may offer or sell insurance consistent with this
section without obtaining a limited license. However, the limited
licensee shall directly supervise and be responsible for the
actions of all other employees at that location related to the
offer or sale of insurance as authorized by this section. No
limited licensee under this section shall advertise, represent, or
otherwise hold himself or herself or any other employees out as
licensed insurers, insurance agents or insurance brokers.
(h) No automobile rental coverage insurance may be issued by
a limited license pursuant to this section unless:
(1) The rental period of the rental agreement does not exceed ninety consecutive days; and
(2) At every rental location where rental agreements are
executed, brochures or other written material are readily available
to the prospective renter that:
(i) (A) Summarize clearly and correctly, the material terms of
coverage offered to renters, including the identity of the insurer;
(ii) (B) Disclose that the coverage offered by the rental
company may provide a duplication of coverage provided by a
renter's personal automobile insurance policy, homeowner's
insurance policy, personal liability insurance policy, or other
source of coverage;
(iii) (C) State that the purchase by the renter of the kinds
of coverage specified in this section is not required in order to
rent a vehicle; and
(iv) (D) Describe the process for filing a claim in the event
the renter elects to purchase coverage and in the event of a claim.
(3) An evidence of coverage on the face of the rental
agreement is disclosed to every renter who elects to purchase such
the
coverage.
(i) The limited licensee to sell automobile rental coverage
may offer or sell insurance only in connection with and incidental to the rental of vehicles, whether at the rental office or by
preselection of coverage in a master, corporate, group rental, or
individual agreements in any of the following general categories:
(1) Personal accident insurance covering the risks of travel,
including, but not limited to, accident and health insurance that
provides coverage, as applicable, to renters and other rental
vehicle occupants for accidental death or dismemberment and
reimbursement for medical expenses resulting from an accident that
occurs during the rental period;
(2) Liability insurance (which may include uninsured and
underinsured motorist coverage whether offered separately or in
combination with other liability insurance) that provides coverage,
as applicable, to renters and other authorized drivers of rental
vehicles for liability arising from the operation of the rental
vehicle;
(3) Personal effects insurance that provides coverage,
applicable to renters and other vehicle occupants of the loss of,
or damage to, personal effects that occurs during the rental
period;
(4) Roadside assistance and emergency sickness protection
programs; and
(5) Any other travel or auto-related coverage that a rental
company offers in connection with and incidental to the rental of
vehicles.
(j) Each rental company for which an employee has received a
limited license pursuant to this section shall conduct a training
program in which its employees being trained shall receive basic
instruction about the kinds of coverage specified in this section
and offered for purchase by prospective renters of rental vehicles:
Provided, That limited licensees and employees working hereunder
are not subject to the agent prelicensing education, examination or
continuing education requirements of this article.
(k) Notwithstanding any other provision of this section, or
any rule adopted by the commissioner neither the rental company,
the limited licensee, nor the other employees working with the
limited licensee at the rental company, shall be required to treat
moneys collected from renters purchasing such the
insurance when
renting vehicles as funds received in a fiduciary capacity,
provided that the charges for coverage shall be itemized and be
ancillary to a rental transaction. The sale of insurance not in
conjunction with a rental transaction shall not be permitted.
§33-12-33. Reciprocity.
(a) The insurance commissioner shall waive any requirements
for a nonresident license applicant with a valid license from his
or her home state, except the requirements imposed by section
twelve,
article twelve of this chapter, if the applicant's home
state awards nonresident licenses to residents of this state on the
same basis.
(b) An individual nonresident producer's satisfaction of his
or her home state's continuing education requirements for licensed
insurance producers shall constitute satisfaction of this state's
continuing education requirements if the nonresident producer's
home state recognizes the satisfaction of its continuing education
requirements imposed upon producers from this state on the same
basis.
§33-12-34. Reporting of actions.
(a) A producer shall report to the insurance commissioner any
administrative action taken against the producer in another
jurisdiction or by another governmental agency in this state within
thirty days of the final disposition of the matter. This report
shall include a copy of the order, consent to order or other
relevant legal documents.
(b) Within thirty days of the initial pretrial hearing date, a producer shall report to the insurance commissioner any criminal
prosecution of the producer taken in any jurisdiction. The report
shall include a copy of the initial complaint filed, the order
resulting from the hearing and any other relevant legal documents.
§33-12-35. Regulations.
The insurance commissioner may, in accordance with article
three, chapter twenty-nine-a of this code, promulgate reasonable
regulations as are necessary or proper to carry out the purposes of
this act. Any legislative rules promulgated under the former
article twelve of this chapter shall remain in full force and
effect but shall henceforth relate to the redesignated statutory
provisions contained herein.
§33-12-36. Severability.
If any provisions of this act, or the application of a
provision to any person or circumstances, shall be held invalid,
the remainder of the act, and the application of the provision to
persons or circumstances other than those to which it is held
invalid, shall not be affected.
ARTICLE 12C. EXCESS LINE.
§33-12C-1. Excess lines.
Any portion or all of an insurance coverage against loss or damage to property or person from any cause which cannot be
procured from licensed insurers, which coverages are hereinafter
designated as "excess line," may be procured from unlicensed
insurers subject to the following conditions:
(a) The insurance must be procured only through a licensed
excess line broker.
(b) The insurance coverage must not be procurable, after
diligent effort has been made to do so, from licensed insurers
authorized to transact that kind of insurance in this state, or has
been procured to the full extent such the insurers are willing to
insure, and the placing of insurance with an unlicensed insurer
must not be for the purpose of securing advantages either as to
premium rate or terms of the insurance contract.
§33-12C-2. Excess line broker's reporting requirements.
On or before the first day of March, one thousand nine hundred
ninety-six, and on or before the first day of March thereafter,
each excess line broker shall file, on a form prescribed by the
commissioner, a report under oath, setting forth facts from which
it may be determined whether the requirements of section ten of
this article have been met with respect to each excess line policy
procured by the excess line broker during the preceding calendar year. Such The report shall include, but not be limited to, the
following:
(a) Name and address of the insurer;
(b) Number of the policy issued;
(c) Name and address of the insured;
(d) Nature and amount of liability assumed by the insurer;
(e) Premium, and premium rate if applicable;
(f) Other information reasonably required by the commissioner.
The commissioner may promulgate rules pursuant to the
provisions of section one, article one, chapter twenty-nine-a of
this code, specifying the reporting forms required by this section.
Legislative rules previously promulgated under former article
twelve of this chapter regarding excess line brokers at the
effective date of this article shall remain in full force and
effect to article twelve-c.
§33-12C-3. Excess line insurance valid.
Insurance contracts procured as excess line coverage from
unlicensed insurers in accordance with this article shall be fully
valid and enforceable as to all parties, and shall be given
recognition in all matters and respects to the same effect as like
contracts issued by licensed insurers.
§33-12C-4. Licensing of excess line brokers.
(a) Any licensed insurance agent determined by the
commissioner to be competent and trustworthy for the purpose, may
be licensed as an excess line broker.
(b) The license fee shall be two hundred dollars, all fees so
collected are to be used for the purposes set forth in section
thirteen, article three of this chapter.
(c) Prior to issuance of the license, the applicant therefor
shall file with the commissioner and thereafter maintain in force
for so long as the license or any renewal thereof remains in
effect, a bond in favor of the state of West Virginia in the penal
sum of two thousand dollars, with an authorized corporate surety
approved by the commissioner, conditioned that he or she will
conduct business under the license in accordance with this article,
that he or she will promptly remit the taxes provided by section
sixteen of this article, and that he or she will properly account
to the person entitled thereto for funds received by him or her
through transactions under the license. No bond shall be
terminated unless at least thirty days' prior written notice
thereof is filed with the commissioner.
§33-12C-5. License expiration and renewal.
All licenses of excess line brokers shall expire at midnight
on the thirty-first day of
May next following the date of issuance.
The commissioner shall renew annually the license of all licensees
who qualify and make application therefor.
§33-12C-6. Licensed excess line brokers may accept business from
agents.
A licensed excess line broker may accept and place authorized
excess line business from any insurance agent or broker licensed in
this state for the kind of insurance involved, and may compensate
the agent or broker therefor. The excess line broker shall have
the right to receive from the insurer the customary commission.
§33-12C-7. Countersignature requirements.
Excess line insurance shall be countersigned by a duly
licensed excess line broker.
§33-12C-8. Records of excess line brokers.
Each excess line broker shall keep in his or her office a full
and true record of each excess line contract procured by him or her
and the record may be examined at any time thereafter by the
commissioner. The record shall include such of the following items
as are applicable:
(a) Name and address of the insurer;
(b) Name and address of the insured;
(c) Amount of insurance;
(d) Gross premium charged;
(e) Return premium paid, if any;
(f) Rate of premium charged on the several items of coverage;
(g) Effective date of the contract and the terms thereof; and
(h) Brief general description of the risks insured against and
the property insured.
§33-12C-9. Excess line brokers; additional premium tax.
(a) Every excess line broker shall make an annual return,
under oath, on or before the first day of March to the commissioner
of the gross amount of premiums charged by the insurers and of the
gross amount of the fees charged by the excess line broker for the
insurance procured by the excess line broker during the previous
calendar year. Every excess line policyholder obtaining insurance
from an excess line broker shall pay and every excess line broker
shall collect from the policyholder and remit to the commissioner
a sum equal to four percent of the gross premiums and fees received
on the excess line policies procured by the excess line broker on
subjects of insurance, resident, located or to be performed in this
state, including any so-called dividends on participating policies
applied in reduction of premiums, but less premiums returned to policyholders because of cancellation of policy. This tax is
imposed for the purpose of providing additional revenue for
municipal policemen's and firemen's pension and relief funds and
additional revenue for volunteer and part volunteer fire companies
and departments. This tax is required to be paid and remitted, on
a calendar year basis and in quarterly estimated installments due
and payable on or before the twenty-fifth day of the month
succeeding the close of the quarter in which they accrued, except
for the fourth quarter, in respect of which taxes shall be due and
payable and final computation of actual total liability for the
prior calendar year shall be made, less credit for the three
quarterly estimated payments prior made, and filed with the annual
return to be made on or before the first day of March of the
succeeding year. Provisions of this chapter relating to the levy,
imposition and collection or the regular premium tax are applicable
to the levy, imposition and collection of this tax to the extent
that the provisions are not in conflict with this section.
All such taxes remitted to the commissioner pursuant to this
section shall be paid by him or her into a special account in the
state treasury, designated "municipal pensions and protection
fund," and after appropriation by the Legislature, shall be distributed in accordance with the provisions of subsection (c),
section fourteen-d, article three of this chapter. The excess line
broker shall return to the policyholder the tax on any unearned
portion of the premium returned to the policyholder because of
cancellation of policy.
(b) The excess line broker may not:
(1) Pay directly or indirectly the tax or any portion thereof,
either as an inducement to the policyholder to purchase the
insurance or for any other reason; or
(2) Rebate all or part of the tax or the excess line broker's
commission, either as an inducement to the policyholder to purchase
the insurance or for any reason.
(c) The licensed excess line broker may charge the prospective
policyholder a fee for the cost of underwriting, issuing,
processing, inspecting, service or auditing the policy for
placement with the excess line insurer if:
(1) The service is required by the excess line insurer;
(2) The service is actually provided by the excess line broker
or the cost of the service is actually incurred by the excess line
broker;
(3) The provision or cost of the service is reasonable, documented and verifiable.
(d) The excess line broker shall make a clear and conspicuous
written disclosure to the policyholder of:
(1) The total amount of premium for the policy;
(2) Any fee charged;
(3) The total amount of any fee charged; and
(4) The total amount of tax on the premium and fee.
(e) The clear and conspicuous written disclosure required by
subsection (d) of this section is subject to the record maintenance
requirements of section fifteen of this article.
§33-12C-10. Fees.
The commissioner shall receive the following fees from excess
line brokers: For letters of certification, five dollars; for
letters of clearance, ten dollars; for duplicate license, five
dollars. All fees and moneys so collected shall be used for the
purposes set forth in section thirteen, article three of this
chapter.
§33-12C-11. Coverage must be placed in solvent insurer.
No excess line broker shall knowingly place any coverage in an
insolvent insurer.
§33-12C-12. Change of address.
An excess line broker shall notify the commissioner of any
change in his or her mailing address within thirty days of the
change. The commissioner shall maintain the mailing address of
each excess line broker, and service representative on file.
Failure to timely inform the insurance commissioner of a change in
legal name or address may result in a penalty pursuant to article
twelve, section twenty-four of this chapter.
§33-12C-13. Service of process on excess line insurers and
brokers.
As to every unlicensed insurer issuing or delivering an excess
line policy through an excess line broker in this state, the
secretary of state shall be, and is hereby constituted the
attorney-in-fact of each insurer and broker for service of process
in the same manner as for licensed insurers as provided in section
twelve, article four of this chapter.
§33-12C-14. Hearings.
(a) When conducting any hearing authorized by section
thirteen, article two of this chapter which concerns any excess
line broker, the commissioner shall give notice of the hearing and
the matters to be determined therein to such excess line broker by
certified mail, return receipt requested, sent to the last address
filed by the person or entity pursuant to section twelve of this article.
(b) If an excess line broker fails to appear at the hearing,
the hearing may proceed, at which time the commissioner shall
establish that notice was sent to the person pursuant to this
section prior to the entry of any orders adverse to the interests
of the excess line broker based upon the allegations against the
person which were set forth in the notice of hearing. Certified
copies of all orders entered by the commissioner shall be sent to
the person affected therein by certified mail, return receipt
requested, at the last address filed by a person with the division.
(c) An excess line broker who fails to appear at a hearing of
which notice has been provided pursuant to this section, and who
has had an adverse order entered by the commissioner against them
as a result of their failure to so appear may, within thirty
calendar days of the entry of the adverse order, file with the
commissioner a written verified appeal with any relevant documents
attached thereto, which demonstrates good and reasonable cause for
the person's failure to appear, and may request reconsideration of
the matter and a new hearing. The commissioner in his or her
discretion, and upon a finding that the excess line broker has
shown good and reasonable cause for his or her failure to appear, shall issue an order that the previous order be rescinded, that the
matter be reconsidered, and that a new hearing be set.
(d) Orders entered pursuant to this section are subject to the
judicial review provisions of section fourteen, article two of this
chapter.
§33-12C-15. Severability.
If any provisions of this article, or the application of a
provision to any person or circumstances, shall be held invalid,
the remainder of the article, and the application of the provision
to persons or circumstances other than those to which it is held
invalid, shall not be affected.
NOTE: The purpose of this bill is to incorporate into Article
12 of Chapter 33 the provisions of the NAIC Producer Licensing
Model Act ("Model"). These changes relate to uniform licensing and
reciprocity for insurance producers. The bill further creates a
new Article 12C of Chapter 33 to separate excess line brokers from
the provisions of the Article 12 relating to insurance producers
and solicitors.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
Sections of 1,2,4,5,6a,6b,7,9,12,14,15,16,26,27,33,34,35 and
36 of article 12, chapter 33 are new; however, the language has
been underscored
to indicate changes to the existing article.
Sections 3,6,8,10,17,18,20,21,23,24,25 and 29 of article 12, chapter 33 are existing sections that have been renumbered with new
language and/or stricken language; therefore,
strike-throughs
indicate language that would be stricken from the present law, and
underscoring indicates new language that would be added.
Sections 11,13,19,22,30,31 and 32 of article 12, chapter 33
are existing sections that have been designated a new section
number; therefore, only the new section number has been underscored
and not the language.
§33-12C
is new; therefore, strike-throughs and underscoring
have been omitted.